I am traveling in Europe for three weeks to discuss the global financial crisis with government officials, politicians and labor leaders. What is most remarkable is how differently the financial problem is perceived over here. It’s like being in another economic universe, not just another continent.

The U.S. media are silent about the most important topic policy makers are discussing here (and I suspect in Asia too): how to protect their countries from three inter-related dynamics: (1) the surplus dollars pouring into the rest of the world for yet further financial speculation and corporate takeovers; (2) the fact that central banks are obliged to recycle these dollar inflows to buy U.S. Treasury bonds to finance the federal U.S. budget deficit; and most important (but most suppressed in the U.S. media, (3) the military character of the U.S. payments deficit and the domestic federal budget deficit.

Strange as it may seem ­ and irrational as it would be in a more logical system of world diplomacy ­ the “dollar glut” is what finances America’s global military build-up. It forces foreign central banks to bear the costs of America’s expanding military empire ­ effective “taxation without representation.” Keeping international reserves in “dollars” means recycling their dollar inflows to buy U.S. Treasury bills ­ U.S. government debt issued largely to finance the military.

An enormous electronic espionage programme run from servers in China has been used to spy on computers in more than 100 countries, according to two reports published at the weekend.

The reports, published by the universities of Cambridge and Toronto, detail a “murky realm” where cyber spooks infiltrate email, take over humble desktop computers and use them to spy on organisations, individuals and governments.

The reports name the system GhostNet, and claim that it has been used to attack governments in south and south-east Asia as well as the offices of the Dalai Lama. In two years, the reports suggest, the operation infiltrated 1,295 computers in 103 countries.

– NZ Women: No dating, thanks, just sex (Sunday Star Times):Dating culture is dead – instead, young New Zealand women are regularly getting drunk and cruising around in packs looking for men to have sex with. That’s one of the findings of a TVNZ Sunday investigation into the sexual behaviour of New Zealand women.

– Le Pen repeats slur that Nazi gas chambers were a ‘detail’ (France24):
Jean-Marie Le Pen, MEP and leader of France’s far-right Front National, outraged assembled members of the European Parliament by repeating his assertion that the Nazi gas chambers were “a mere detail” in the history of the Second World War.

– Suicide watch for soldiers in Iraq (Telegraph):An unprecedented “suicide watch” has been launched by commanders at Britain’s main military base in Iraq following the deaths of three soldiers.

Researchers have developed a robot capable of learning and interacting with the world using a biological brain.

Credit: Kevin Warkwick

Kevin Warwick’s new robot behaves like a child. “Sometimes it does what you want it to, and sometimes it doesn’t,” he says. And while it may seem strange for a professor of cybernetics to be concerning himself with such an unreliable machine, Warwick’s creation has something that even today’s most sophisticated robots lack: a living brain.

Life for Warwick’s robot began when his team at the University of Reading spread rat neurons onto an array of electrodes. After about 20 minutes, the neurons began to form connections with one another. “It’s an innate response of the neurons,” says Warwick, “they try to link up and start communicating.”

For the next week the team fed the developing brain a liquid containing nutrients and minerals. And once the neurons established a network sufficiently capable of responding to electrical inputs from the electrode array, they connected the newly formed brain to a simple robot body consisting of two wheels and a sonar sensor.

Farmer Robert Meyboom: “Within two or three days, they were all dead.”

A mysterious illness is causing calves to bleed to death on German farms. Veterinarians are stumped over what is causing the deaths: vaccines, genetically modified feed or perhaps even the first mother’s milk?

What can a cattle farmer do when he sees blood running from his calves like water, when they become lethargic and febrile and, by the next morning, are lying dead on the floor, their coats covered in blood?

“Our calves from last summer looked like they had been beaten,” says farmer Robert Meyboom, who is still shocked and perplexed today. “The animals’ bodies were covered with drops of blood, and their eyes were bloodshot.”

The veterinarian tried everything, he says, including administering vitamins and blood-clotting agents. But nothing worked, and “within two or three days, they were all dead.”

Norway’s global pension gamble

Mr Slyngstad remains committed to his investment strategy

Yngve Slyngstad likens his first year in the job to that of steering a supertanker through what others have described as a “perfect storm”, characterised by tight access to credit, falling asset values and soaring commodity prices.

He always knew it would be a challenge, though he had not been prepared for exactly how choppy the waters would be.

It all came to a head earlier this month when it was revealed that Mr Slyngstad’s fund suffered a loss of more than $90bn (£61bn) last year.

The loss was so big, it wiped out pretty much everything Norway’s so-called oil fund had made since it started investing Norway’s oil and gas earnings in the global financial markets 12 years ago.

Critics were quick to point out that the hit was equivalent to a loss of more than $18,000 for every man, woman and child in the country – the exact people whose retirement wealth Mr Slyngstad’s 217-strong team were supposed to be safeguarding.

Mr Slyngstad is in charge of The Government Pension Fund of Norway – the second largest sovereign wealth fund in the world after that of the United Arab Emirate – having taken charge in January last year.

A spring storm that blanketed much of the state with heavy snow pushed out of the state on Saturday, leaving residents of the hard-hit Panhandle to dig out from under as much as two feet of snow. (AP Photo/Tulsa World, Stephen Holman)

KANSAS CITY, Mo. (AP) — Storms spread misery Saturday from the Great Plains to the Gulf Coast, dumping spring snow that cut power to thousands of Kansas utility customers and spawning tornado warnings and heavy rain across the South.

Two deaths were reported in Kansas as a spring blizzard buried parts of the state in ice, slush and up to two feet of snow. A 72-year-old man shoveling snow died of a heart attack Saturday while waiting for an ambulance slowed by impassable roads in Arlington, in central Kansas, authorities told The Hutchinson News. On Friday, a 58-year-old woman was killed in a car accident on icy roadways in Marion County.

The system also prompted a disaster declaration in Kansas and was blamed for two traffic deaths in Oklahoma.

The National Weather Service warned eastern Iowa about a narrow band of snow that will be particularly nasty, with forecast accumulation of 4 to 6 inches.

This week, Tim Geithner launched the details of the new public-private partnership to save the banks. The basic idea, as you know, is that outside investors will be offered leverage to buy up so-called toxic assets.

In other words, the government is printing up a lot of cash money for private investors to get rich on.

As a service to you, dear reader, we thought we’d list all the ways that you can scam the government and taxpayers for your own profit.

Overpay for trash assets, after getting a secret agreement from the bank that the bank will make it worth their while. The hedge funds immediately write the assets down, destroying their equity and the taxpayer. Then they sell them back for peanuts to the banks, but the bank pays the hedge fund a “fee” that would compensate for the lost equity. (It wouldn’t be explicit, of course. But given the amount of money that flows back and forth between the big banks and hedge funds, it won’t be hard to hide.) The hedge fund profits. The bank profits and the taxpayer is scammed.

Make hundreds of long-shot bets, structuring each individual asset purchase as a separate entity. Most of these entities will lose money, but so what? You can just write them off and keep the money from the winners.

Set up an investment firm to buy your trash assets from you and fund the firm’s equity with crap assets. This investment firm, which you control, will then intentionally overpay for your remaining tax assets with borrowed taxpayer money. It’s legal money laundering! Continue reading »

The financial giant Goldman Sachs spent tens of millions of dollars to bail out two senior executives last fall who were short on cash, according to the bank’s proxy statement filed on Friday.

In an unusual move, Goldman bought back stakes in some internal investment funds from Jon Winkelried, the bank’s co-chief operating officer, and Gregory K. Palm, its general counsel.

Both executives are among the largest shareholders in the bank, owning more than a million shares each, and directors were concerned that a large sale of Goldman shares by the two men would alarm investors during a period of market turmoil, according to a person briefed on the matter.

To avoid the stock sales, Goldman paid Mr. Winkelried, who retired last month, $19.7 million to purchase about 30 percent of his investments in internal hedge funds and private equity investments.

The bank paid $38.3 million to Mr. Palm for about a quarter of his investments.

Soon after the bank aided the two executives, Warren E. Buffett invested $5 billion in Goldman, and the bank’s top four executives agreed not to sell more than 10 percent of their stock for three years.

Baltasar Garzón, front, in Madrid. He has built an international reputation by bringing cases against human rights violators.

LONDON – A Spanish court has taken the first steps toward opening a criminal investigation into allegations that six former high-level Bush administration officials violated international law by providing the legal framework to justify the torture of prisoners at Guantánamo Bay, Cuba, an official close to the case said.

The case, against former Attorney General Alberto R. Gonzales and others, was sent to the prosecutor’s office for review by Baltasar Garzón, the crusading investigative judge who ordered the arrest of the former Chilean dictator Augusto Pinochet. The official said that it was “highly probable” that the case would go forward and that it could lead to arrest warrants.

– Thousands flee Fargo ahead of floodwaters (Independent):The National Weather Service targeted the crest near 42 feet, but said it was still possible the river could rise to 43 feet – the same level at which the levees are built to protect the city and nearly 3 feet higher than the record set 112 years ago.

– Canada says will defend its Arctic (AFP):
The Canadian government on Friday reaffirmed its Arctic claims, saying it will defend its northern territories and waters after Russia earlier announced plans to militarize the North.

– Is there any gold inside Fort Knox, the world’s most secure vault? (Times Online):“It has been several decades since the gold in Fort Knox was independently audited or properly accounted for,” said Ron Paul, the Texas Congressman and former Republican presidential candidate, in an e-mail interview with The Times. “The American people deserve to know the truth.”

– Merkel warns on further stimulus (Financial Times):Angela Merkel, the German chancellor, will warn leaders of the world’s largest economies next week against pumping too much money into reviving global growth, saying that such action would create an unsustainable recovery.

The liberal backlash against President Barack Obama has begun with many prominent left-leaning economists in the US attacking the administration’s plans to bail out the banks.

Paul Krugman describes the toxic asset purchase plan as “cash for trash”. Jeffrey Sachs calls it “a thinly veiled attempt to transfer hundreds of billions of US taxpayer funds to the commercial banks”. Robert Reich depicts Tim Geithner, Treasury secretary, as a prisoner of Wall Street while Joe Stiglitz says the plan “amounts to robbery of the American people”.

On the blogosphere and beyond, Democratic economists accuse Mr Obama – along with Mr Geithner, and Lawrence Summers, the president’s senior economic adviser – of taking dictation from the same financiers who have brought the economy to the brink of depression.

A member of the research team in one of the modules where the experiment will take place Photograph: Pavel Zelensky/AFP/Getty Images

In a car park not so far away … It is a big brother experiment like no other, an experiment which will boldly go where few have gone – or probably wanted to go – before.

Six apparently fearless volunteers are to take part in a unique test by being locked up in what amounts to a series of small steel tins off a parking lot in Moscow for 105 days as scientists simulate a space rocket ride to Mars.

On Tuesday the team will step into a chain of cramped metal capsules, connected by cables and corrugated metal pipes, in a hangar at the back of the Institute of Medical and Biological Problems (IMBP) in the Russian capital, swing close the hatch and “blast off”.

The idea is for the 550 cubic-metre “ground exploration complex” (GEC) to recreate as closely as possible the atmosphere of a spacecraft racing through the solar system, bombarded by cosmic radiation. Any return flight to Mars – at least 34 million miles from our planet – would take between 18 months and three years, including landing and exploration.

The volunteers – four Russians, a French airline pilot and a German army engineer – will be kept under constant camera surveillance to record the physical and psychological impact of their time in the isolation chamber.

Drastic new tacticsto prevent school pupils as young as 13 falling into extremism

Two hundred schoolchildren in Britain, some as young as 13, have been identified as potential terrorists by a police scheme that aims to spot youngsters who are “vulnerable” to Islamic radicalisation.

The number was revealed to The Independent by Sir Norman Bettison, the chief constable of West Yorkshire Police and Britain’s most senior officer in charge of terror prevention.

He said the “Channel project” had intervened in the cases of at least 200 children who were thought to be at risk of extremism, since it began 18 months ago. The number has leapt from 10 children identified by June 2008.